Passionate about IP! Since June 2003 the IPKat has covered copyright, patent, trade mark, info-tech, privacy and confidentiality issues from a mainly UK and European perspective. The team is Eleonora Rosati, Annsley Merelle Ward, Neil J. Wilkof, and Merpel. Nicola Searle is currently on sabbatical. Read, post comments and participate! E-mail the Kats here

The team is joined by GuestKats Mirko Brüß, Rosie Burbidge, Nedim Malovic, Frantzeska Papadopolou, Mathilde Pavis, and Eibhlin Vardy

Sunday, 31 May 2015

Last week, in "3D printing and the law: three recent studies and some recommendations", here, this weblog posted news from Dinusha Mendis of three recently-published reports on the intellectual property implications of 3D printing. The reports (all of which can be accessed here) arose from a project commissioned by the UK Intellectual Property Office (UKIPO). To refresh readers' memories, they are (i) Study 1: A Legal and Empirical Study of Online Platforms and an Analysis of User Behaviour, (ii) Study II, The Current Status and Impact of 3D Printing Within the Industrial Sector: An Analysis of Six Case Studies and (iii) an Executive Summary.

This Kat hasn't yet found the time to read them -- but fellow 1709 Blogger Andy Johnstone has. Wearing his critical glasses, Andy writes as follows:

I found Section A of Study I -- the legal analysis part of the study -- rather disappointing. If 3D printing is the disruptive technology some claim it to be, in what way does it or will it disrupt IP law in the way that Lipson and Kurman predict in their forecast that "intellectual property law will be brought to its knees", as quoted in the Introduction to Study I?

What LucasFilm was all about

Section A really doesn't address the wider issue. Surely the first question is, which areas of IP law should we be examining in relation to the end product: is it copyright, design right, trade mark or patent law which is most affected? The authors have effectively discounted all but copyright, even though they then show that, following such cases as the UK Supreme Court decision in Lucasfilm [noted by the IPKat here], copyright will not normally apply to practical articles. Because of the over-reliance on copyright there is not a single mention in Section A of the equally, if not more, relevant UK and EU law on designs (ie the 'Designs' bit of the Copyright, Designs and Patents Act 1988 (CDPA), the Registered Designs Act 1949, the EU Designs Directive 98/71 and the Community Design Regulation 6/2002).

This perhaps occurs, in part, because Section A of Study I fails to set itself a clear aim. At one point (paragraph 1 page 2) the authors speak of "further interesting questions about the intellectual property status of such design files ..." and later (third paragraph Page 3) they say; "this Report aims to provide a clearer understanding of 'how' the sharing happens ... " and then later (paragraph 4 Page 30): "Section A of this Report will begin with a consideration of the copyright implications arising from the access and use of these online platforms." The last sentence of paragraph 3 Page 3 states that the Report will focus particularly on the copyright element for "reasons as explained below" but then fails to provide any reasons.

The Section's second weakness, to my mind, is that it too readily conflates the design drawing with the final 3D object. Much time is spent agonising over whether a CAD file can be subject to copyright if the final product doesn't fall neatly into a copyright category. A better approach would be to examine the two aspects in isolation, much as one might see the copyright in a song as being entirely separate to the copyright in the sound recording of the song (the phonogram). If design right law had been used as the vehicle for examining the issues, life might have been a little more straightforward.

But after a less than focused Introduction, the Report becomes almost immediately sidetracked into whether a Computer Aided Design (CAD) file is protected by copyright, without analysing which intellectual property rights are at risk through the introduction and development of 3D printing. Why, for instance, is the copyright status of the design file seen as being so important? Two completely different CAD files could produce exactly the same finished article, just as two separate sets of architects' drawings produced independently of each other could result in two houses which looked substantially the same. If the CAD file has been copied without permission, is the legal issue about infringement of the file, or about the production of the same end product?

The Report, having failed to answer that question about whether or a CAD file is protected by copyright, then addresses licensing, and whether exponents of 3D printing know about their rights and how to protect them. Neither problem arises solely from the advent of 3D printing; indeed almost exactly the same comment could be made about users of Facebook and their photographs, so in this respect Section A tells us nothing about the specific legal implications of 3D printing. Happily, on a positive note, I can say I entirely agree with the Report's recommendation that nothing needs to be done right now on the legal front -- but for entirely different reasons.

A more detailed look at the issues

Surely it's about more than just copyright

Presumably the main evidence of any sort of infringement, if it exists, is to be found in the end product -- the thing which the 3D printer makes. But by starting with the design document (ie the CAD file) the authors go up a blind alley because, apart from the technical process by which the item is manufactured in 3D printing, there is no outward difference between a CAD file and a pdf or a mpeg, or a jpg or an avi file; they are all digital files which define, respectively, a 3D object, a text document, some sounds, an image, or film/video once they have been converted into a form perceptible by a human being. There is little question that the current law recognises a jpg file as both a means of recording a work and as a copy as far as it concerns copyright in the artistic work it defines, just as an avi file is taken to be a copy of the video it holds in digital format. The CDPA already says (s.17(2)) that

"Copying in relation to a literary, dramatic, musical or artistic work means reproducing the work in any material form. This includes storing the work in any medium by electronic means."

Thus if the final product is one which falls into the categories of protected works, the intermediate digital form, be it CAD or jpg, is clearly protected. But what if the product is too utilitarian or practical to qualify as an artistic work? We know from s. 9(3) that

"[i]n the case of a literary, dramatic, musical or artistic work which is computer-generated, the author shall be taken to be the person by whom the arrangements necessary for the creation of the work are undertaken"

and so the law seems relatively clear that a work generated by a computer under human guidance (which is what a CAD file is) can certainly be protected by copyright, but is the work which the CAD file represents an artistic work? Given that it bears many similarities with an architect's drawings (incidentally these are almost exclusively drawn by CAD these days), which are explicitly protected, I think the answer has to be that the design for anything will be an artistic work provided it meets the basic originality test applicable to any work; to that extent it is immaterial whether the end product is utilitarian or artistic, just as the building constructed to the architect's design can be artistic or utilitarian, without affecting the copyright status of the architectural drawings.

Who says a CAD File is a computer program

The major mistake I believe that Section A makes is trying to make a CAD file fit into the definition of computer program. This tends to suggest a complete misunderstanding of 'computer program' as defined in the software directive, and more generally how the term is understood by information technology specialists. Evidence of this misunderstanding can be seen in the assertion in paragraph 3 on page 9 that the CDPA

"... states that a computer program and its embedded data for example is recognised as a literary work under copyright law"

with a footnote reference to ss 3(1)(b) and (c) CDPA. From this the authors go on to state that

"... it can be argued that a computer program encompasses an object design file or CAD file within its definition and is therefore capable of copyright protection as a literary work".

The problem with that argument is that s. 3(1) CDPA makes no mention of embedded data. What it actually says is that a literary work includes "(b) a computer program; [and] (c) preparatory design material for a computer program." This form of words is taken directly from Article 1 of the EU Software Directive 2009/24. There is no mention of embedded data, or indeed any other form of data, which is what CAD file comprises. Just to be clear, the reference to 'preparatory design material for a computer program' is referring to flow diagrams, systems analysis and other precursors to writing a program, not design drawings. No computer specialist would ever confuse the terms 'computer program' and 'data'. Regrettably a lay person might.

One consequence of this line of argument is that, by only considering CAD files in terms of literary copyright (because that is the category under which programs come) the Report fails to consider a CAD file in terms of the type of work it represents, namely a 'design', which will almost always means it will be an artistic work, irrespective of whether the final object attracts copyright.

To be fair to the authors of the Report, they are often merely quoting others who seem equally confused about the nature of CAD files and want to treat them as 'software'. And at the foot of page 10 the authors almost concede that a CAD could be an artistic work. But it's a single sentence which is not pursued, before reverting on page 12 to the former viewpoint of seeing CAD files solely as computer programs. But let's just be perfectly clear about this, a CAD file is just a structured string of data which needs to be interpreted by software in order to render it either onto a screen or into a 3D physical object. It is no more complicated than Photoshop .psd file which can contain both the basic image taken by a digital camera and a record of all the alterations made to the image during the editing process. Or to take another example of a '3D' file, let's look at the myriad of video file formats in existence. These all store data covering three basic dimensions - x and y axes data, and time - plus a sound track, and occasionally such things as sub-titles and alternative camera angles. There is little doubt that if someone illegally copies a digital video recording such as that found on a DVD or BluRay, that amounts to infringement of the original work, and counsel for the plaintiff would not need to spend a moment in convincing the court that this digital recording was undoubtedly a 'work' even though no-one in the court could see or hear it at the time the physical DVD itself is exhibited. Not until it is placed in the correct player will the video be perceptible to human senses. Exactly the same principles apply to a CAD file. Load the CAD file into a suitable computer running the requisite software, and the design(s) held within the CAD data will be made visible.

Modify someone else's or scan your own file

The Report briefly touches on the law which might apply to modifying a design -- something with which I suggest the current jurisprudence is perfectly well equipped to deal. There is a suggestion that some of the apps which the 3D 'platform' websites make available might represent game-changers in terms of the modifications users are thus enabled to make to existing designs. Fortunately this is not taken further, but suffice it to say that 3D printing technology and these apps offer absolutely nothing new that we have not experienced in the past 25 or so years that Microsoft Word (for text), Photoshop (for images) and Qubase (for music) have been available. If the specific issue is with cheap apps, then these too have been available for several years via sites such as Instagram, and more recently Apple's AppStore, and they have been used widely for image manipulation during that time. The Report then looks at the copyright implications of scanning an existing object in order to create a new design file. Once again we have plenty of settled law about creating derivative works, and what might constitute additional intellectual creativity reflecting the personality of the scanner, during the post scan editing process. The examples given of current practices in the 3D printing world do not raise any new threats to the existing law.

Design Right

So what would adding an analysis of current design right law have added to the Report's scope? Quite a lot really, since design right is specifically intended to protect the sorts of objects most likely to be produced by 3D printing. The principal advantage is that by referring to design right law, the focus moves away from the (in my view, artificial) problem about whether or not a CAD file is subject to copyright, and moves it on to the protection available for the end product. Under design right law what matters is not whether the actual design document has been copied (that can continue to be dealt with under copyright law) but whether the product has an individual character (cf 'originality' under copyright law) and whether the 'copy' produces the same overall impression on an informed user. This answers the 'problem' raised in the fifth paragraph on page 14 where Interlego v Tyco Industries is cited concerning practical or utilitarian items not covered by copyright. It also clarifies the status of scanned products mentioned in the first paragraph of page 15. The second advantage of design right is that it makes no reference to the material from which the item is made. Chocolate, human tissue and organs -- all mentioned as 'issues' raised by 3D printing -- remain just materials which are irrelevant to the test for copying of a design. Arguably, the reproduction of human tissue and organs is far more likely to run into ethical problems than it is to lead to infringement claims.

Do we have a regulation problem?

Finally the Report examines 'regulation' of the various platforms which represent the major user communities where 3D printing is being developed and exploited. Apart from the licensing issue already referred to, the main concern here seems to lie in the fact that most of these platforms operate from within the USA and so, the Report contends, this poses jurisdictional problems for the way that infringement issues can be resolved. The Report examines what the terms of service of the various sites have to say on the matter, but once again we find that no new concept within IP law is engaged by 3D printing, which the courts have not already had to address with 'old' technologies such as BitTorrent, streaming video, or satellite TV for that matter.

I can't help thinking that when Professor Hargreaves advocated that changes to IP policy should be based on hard empirical evidence, he possibly didn't have this sort of tour d'horizon in mind.

Bio and pharma patent attorneys have had an entertaining few months following the exploits of Swiss-style claims in the Courts of England and Wales. As a reminder to those unfamiliar with these claims the format is below:

‘Use of drug X in the manufacture of a medicament for treating disease Y.’

The format is tremendously flexible though, and claims like this are possible:

﻿﻿﻿﻿﻿﻿‘Use of drug X in the manufacture of a medicament for preventing disease Y in an individual with gene Z that leads to susceptibility to disease Y, wherein drug X is administered by a device implanted in the arm of the individual which simultaneously delivers an electric current to the surrounding tissues.’

To avoid infringement of the Swiss claim no onewas told which drug was being manufactured

In January in Warner-Lambert Company, LLC v Actavis Group Ptc EHF & Others[2015] EWHC 72 (Pat) Mr Justice Arnold said the Swiss style claim requires the infringer to ‘subjectively intend’ that the medicament will be used for the relevant condition. Last week the Court of Appeal said that was incorrect in Warner-Lambert Company, LLC v Actavis Group Ptc EHF & Others [2015] EWCA Civ 556, and that actually all that is required is for the infringer to know, or be able to reasonably foresee, that the medicament would be used to treat the condition (Katposthere). In the decision the Court of Appeal complained:

‘54. There are other criticisms which could be made of Swiss form claims. If the purpose of the new form of claim was to maintain the policy of preventing doctors being sued for infringement, it is difficult to see how that is achieved. As the claim is a process claim (see below), its direct product, the medicine, is an infringement, and all those who use or dispose of the product will infringe. The EPC 2000 seems even more apt to catch anyone who uses the product. As Lord Nicholls of Birkenhead said in Sempra Metals v IRC[2007] UKHL 34; [2008] 1 AC 561 at [51]:

"Legal rules which are not soundly based resemble proverbial bad pennies: they turn up again and again."

55. So it is here. As I shall have to explain, thirty years after the decision in Eisai courts of member states are still working out how to deal with the fall-out from that case. It would have been better if doctors had been provided with a defence, or the restriction on methods of treatment repealed altogether.’ ﻿﻿

Passing on a claim format is not always kind

Who knew 30 years ago that the High Court, England and Wales, would misinterpret the meaning of a Swiss style claim in this way? In fact I’ve known patent attorneys who deal with Swiss style claims every day. They understand them in their ‘bones’ so to say, and they’ve realised for many years the terrible complexity of deciding on how such claims would be infringed, as Mr Justice Arnold has discovered. In the second example of the claim I have given above, to what extent do the parties that detect gene Z, make the device or implant the device infringe?

Undoing things and the intergenerational inheritance of claims formats

Only now are we realising how inappropriate it was to use Swiss style claims to get round the prohibition on patenting methods of treatment. I recently read a paper by Thambisetty (seehere) which talks of how

‘claim formats in Examination Guidelines often draw on previous texts and are the result of complex legal and technical compromises struck along the way, and intergenerational because often these compromises refer to historic arrangements, which although devoid of current substantive significance continue to have an impact on the contours of the claims’

So we ‘inherit’ our claim formats and are stuck with them, and there seems to be little we can do about that.

How is patent reform in the US going?

This Kat admits to being a bit lost trying to follow patent reform in the US. This blog gives occasional insights (here), but it is clear that there is a lot of legislation proceeding through Congress such as the following Acts (here):

The Innovation Act - has provisions for fee-shifting (the loser in patent litigation pays the attorney fees), heightened pleading standards and a “customer-stay provision” (which seeks to protect customers from patent lawsuits).

The STRONG Patents Act - has several provisions including some relating to post grant proceedings carried out by the Patent Trial and Appeal Board (PTAB) requiring it to abandon the broadest reasonable interpretation standard (BRI) and mandating that claims be presumed valid.

The PATENT Act - which also concerns litigation and includes higher pleading standards.

The Innovation Protection Act - which concerns funding of the United Stated Patent and Trademark Office (USPTO).

The pace of reform happening in the US is quite astounding and impressive. Clearly Congress feels it must be responsive to problems in the patent system, and I wish the UK Parliament was equally responsive to IP issues.

The AIA brought in new post-grant procedures at the USPTO where third parties could attack and cause revocation of a patent. Such proceedings have been found to be a highly effective way of revoking a patent, and that happens in a high proportion of cases. Inter Partes Review (IPR) is one such procedure and is now being used to manipulate the stock prices of companies (here). The company stock is ‘short’ sold where a party makes money when the price of a stock goes down (here) and then an IPR is filed to bring the stock price down. Further, hedge funds are now filing IPRs as part of strategies to bring down the value of small pharmaceutical companies (here).
﻿

Unintended consequences

The provisions of the AIA came into effect in 2012 and 2013, and we are slowly discovering all the unintended consequences. Patent rights play a finely-balanced role in the economy. Whenever the rights are strengthened or weakened then many different parties will gain or lose, and there are always unintended consequences. On wonders what other fallout there will be from the AIA, and then in turn from all the other Acts which Congress is in the process of rolling out. The example of Swiss style claims is a reminder that things are not easily undone, and it is easy for quick fixes to leave problems for future generations.

Friday, 29 May 2015

Forthcoming events. June is nearly upon us, with all the joys of summer (in the Northern Hemisphere) and winter (Down Under) that June can bring. If you are hoping to share a little of that joy with fellow IP enthusiasts, do please check out the IPKat's Forthcoming Events page, which lists various opportunities to meet them and exchange news and views on the IP issues of your choice. Some of the listed events are actually free, while others are either affordable or offer discounts to IPKat readers [and some, adds Merpel, are rather expensive]. If you never attend any events, remember -- the alternative is the dreaded webinar ....

On the subject of forthcoming events, this year's AIPPI bonanzaWorld
Congress will be held in Rio de Janeiro, Brazil, from 10 to 14 October
2015. You can check out the programme here. Alas, there aren't any discounts for Kats or their readers, but registrations made by 10 June 2015 benefit from a lower registration fee. Click here to register. For the benefit of those who have only just found the internet, who have new and exciting technical issues or who just hate the chore of online registration, help is available at registration@aippi.org.Do you, like the IPKat, receive all the information you want from the World Intellectual Property Organization (WIPO)? If so, please play attention to the this WIPO notice:

WIPO: on the road to a newinfo-distribution platform

We’re moving to a new newsletter and press-release
distribution platform.

If you aren't already a subscriber to WIPO's many services, do take the opportunity to visit the links above and take a look at quite how many different publications are on offer -- and they aren't all in English either!

Patent attorneys: a basic instinctto train and take examinations ...

Basic instinct. The time of year has come round again when the CEIPI course
"Basic training in European Patent Law” (here)
has started again in London. Fellow Kat Darren did a post about this last year.
The course is designed to teach European patent law to aspiring trainee
patent attorneys, and is divided into the Basic Course, which works towards the
European Qualifying Examination pre-Examination, and the Advanced course, for
those who have passed the pre-Examination, which works towards the main EQE (explanation here).
The two levels of course run in parallel and each lasts one year. Simon
Roberts, who is organising the London course, tells IPKat readers
that the Basic course is nearly full, but that there are about 10 more places
left available on the advanced course. The Basic course costs 1,500 euros,
the Advanced course £1,000. In a new development, the organisers have
started offering a conference call facility on the two courses (with
experiments planned to use multipoint video conferencing via Skype or the
like), as there are some students based beyond the M25 [an orbital road, circumscribing the Greater London area, which is sometimes described unkindly as the world's largest carpark]. Students could be
accepted on either course if they want to use the conference call facility. The
Basic sessions are on Wednesdays, the Advanced sessions are on Mondays. All the
sessions are held in BT’s headquarters’ building by St Paul’s tube and the
sessions run from 5.30 to 8.30 according to time-hallowed tradition.
There is no specific website for the London course in particular - anyone
interested is asked to address enquiries by email to ceipilondon@gmail.com.

Prior art?

Around the weblogs. "Canadian Piracy Rates Plummet as Industry Points to Effectiveness of Copyright Notice-and-Notice System", on Michael Geist's blog, is a striking example of a headline that calls out "explain me!" Is it causation, correlation, ligtigation, education? (Katpat to Chris Torrero for spotting this piece). Elsewhere, PatLit reports on Luxembourg signing up for the Unified Patent Court Agreement [small ratification, no-one hurt ..., says Merpel] and also on patents for underwired bras and a pair of infringements. There's plenty on the 1709 Blog too, including Ben Challis's latest CopyKat round-up and Andy Johnstone writing on the Fall and Rise of Touch Sensitive.

If there were a competition for the worst saxophone player ever, this Kat would be a worthy candidate. Eight years of lessons and a summer at music camp did little to change the bitter reality that when I played the saxophone, it was the aural equivalent of assault and battery. For that reason, perhaps, I have always had a grudging respect bordering on envy for those musicians who set up shop at the local street corner or subway station, empty music case nearby, performing on the musical instrument of choice and hoping for the financial best from those passers-by who might appreciate the musical interlude. Popularly called "busking", such performance by musicians and others in a public space is an integral part of urban, and not-so urban landscapes, around the world. Busking on streets, at least in the U.S. was once a crime, but no longer. The same is now true for busking at a subway station, although the use of amplifiers and the like may still be disallowed. And, as we are reminded, there are those in the law enforcement community who still seem to think that busking requires a permit.

After recently leaving an energetic local busker a suitable donation for his artistic endeavours, this Kat got to wondering about the IP aspects of busking (although Mrs Kat thought my fascination a bit over the top). Before doing so, a word about the economics of busking. As summarized in a recent online post on the subject at priceonomics.com, several factors need to be taken into account by a prospective busker. First, some times of the day are better than others for busking (i.e., they are more profitable). That may seem obvious when one compares 3:00 am with 6:00 pm but it may be less obvious that Friday evening is a much better bet than Monday afternoon. Secondly, treat the busking performance as a business opportunity. "Sort of knowing" the music and words will not do, even if you are performing at a peak busking time. Thirdly, location is crucial. This is more nuanced than it may seem; the challenge is to find a site "where you music fits in". Actually, that should read "sites". No one can make a busking go at it solely by lodging oneself at only one location (otherwise, "you overstay your welcome"). Fourthly, be ready for wide swings in the audience and its receptivity to your music. There are no season tickets for those who might pass by at any given moment. Fifthly, learn the local rules. While busking may not be illegal, it may be subject to local regulations. Finally, busking is also becoming a creature of the online world, which enables a performance to be recorded and shared beyond the confines of the particular public space.

Against this backdrop, perhaps the overarching IP implication of busking is that IP simply seems not to apply, even if rests on the public performance of a (usually) copyright-protected musical work. If the public space is large and fluid enough, it is as if the notion of the public ceases to have practical copyright meaning. This Kat is not aware of any instance in which the owner of a musical work sought to shut down a busker performing his work because the owner did not wish to have his work associated with busking. Moreover, this Kat is not aware of a busker that has received a demand that it pay a fee for having engaged in the performance of a musical work. Compare that with the demand for payment that is made on a radio station simply for having played a recording of a musical work. From the vantage of the busker, in those jurisdictions in which the performer enjoys a separate performer's right, this Kat is not aware of a circumstance in which the busker has sought to prevent the recording of his performance.

The notion of trade marks and branding also seems to play a different role in the busking environment. As noted:

"On the street, except for extreme circumstances, reputation rarely plays a part. You're almost always performing as an unknown" … [busking feels to a busker] "like art in its purest form".

The article goes on:

"The upside to this is that it’s a level playing field. It doesn't matter who your agent is or whether you have a record deal: if you win someone over in the brief window of time they're in earshot, they're yours."

Perhaps this is changing a bit as the impact on social media enables individual buskers to develop their own brands. Still, it is the case that the brand at issue in busking is rarely the person or group that is performing, but busking itself. The rising tide of general public appreciation for the work of buskers in a given locale redounds to the benefit of all. To recall—busking feels "like art in its purest form." Keep that in mind the next time that you pass a busker plying his or her craft.

QED for QNV. Case T 420/14Wine in Black GmbH v Office for Harmonisation in the Internal Market (Trade Marks and Designs) (OHIM), Quinta do Noval-Vinhos, SA is a 21 May decision of the General Court of the European Union in a fascinating exercise in comparison of marks for identical goods.

In June 2012 Wine in Black applied to register the words Wine in Black as a Community trade mark (CTM) for ‘alcoholic beverages, (except beers), in particular: wines, brandy’ in Class 33 of the Nice Classification. That October Quinta do Noval-Vinhos (QNV) of opposition based on its own earlier CTM, NOVAL BLACK, registered for the same goods. Citing Article 8(1)(b) of the Community Trade Mark Regulation QNV argued that, on account of the identity of the parties’ respective goods and the similarity of their marks, there was a likelihood of confusion of average European wine drinkers who either spoke or had some knowledge of English and who were reasonably attentive to what they chose to drink.

The Opposition Division upheld the opposition and the First Board of Appeal dismissed Wine in Black's appeal. Said the Board, when comparing the parties' respective signs

(i) the marks had a certain degree of visual similarity, and a phonetic and conceptual similarity, as they contained the same number of syllables, had a similar structure and coincided in respect of the word ‘black’, which certainly appeared at the end of those signs;(ii) the word 'black' was characterised as being non-descriptive of the goods in question, unlike the word ‘wine’ in Wine in Black’s trade mark;(iii) NOVAL BLACK had average inherent distinctive character; and(iv) the goods concerned could be ordered in restaurants, bars or cafés, which strengthened the role of phonetic similarity between the marks and reduced the importance of the visual differences.

Wine in Black then applied to the General Court, seeking to have the decision of the Board of Appeal annulled. Its wish was granted. According to the General Court:

* The Board of Appeal was wrong to find that the word signs Wine in Black and NOVAL BLACK were "visually similar to a certain degree". Wine in Black comprised three words, whereas NOVAL BLACK had only two, so their structure was only similar to a low degree. Secondly, while their lengths were similar, they began differently -- and the first part of a trade mark normally has a greater visual impact than its final part. Since the word ‘noval’ had no meaning and could not therefore be said to describe the characteristics of the goods, when placed at the beginning of QNV's mark it would attract the public’s attention more than the word ‘black’, although the latter was by no means negligible. Accordingly the two signs were visually similar to a low degree only, thus less similar than the Board of Appeal had found.

* Regarding phonetic comparison, the Board was wrong to find that the two signs were pronounced with the same rhythm and intonation simply because they contained the same number of syllables. There was practically no correspondence between the letters comprising the first two syllables of Wine in Black and those in the first two syllables of NOVAL BLACK. The fact that an equal number of syllables are distributed over a different number of words was likely to generate differences of rhythm and intonation in the marks' pronunciation. Finally, since ‘noval’ did not belong to the English language, the relevant public would not know exactly how to pronounce it: this precluded a presumption that the word would be pronounced with the same rhythm and intonation as the ‘Wine in’ part of 'Wine in Black'. There was thus only a low degree of phonetic similarity between the signs, contrary to the view of the Board of Appeal.

* Conceptually, while the shared presence of the word ‘black’ constituted an element that could give rise to similarity, the Board of Appeal was none the less required to conduct its assessment by considering each of the two signs as a whole. The Board of Appeal however merely argued that its finding that the signs at issue were conceptually similar was not affected by the differences resulting from the words ‘wine’ and ‘in’ in Wine in Black and the word ‘noval’ in NOVAL BLACK, since its finding concerned weakly distinctive elements and an element devoid of any semantic content. In doing this, the Board of Appeal did not assess Wine in Black’s mark as a whole and failed to take into account the fact that, even if the word ‘wine’ by itself was weakly distinctive in respect of the goods covered, the words ‘Wine in black’ had an imaginative and evocative character.

* Since the colour black did not describe the organoleptic characteristics of wines, an expression meaning ‘Wine in black’ must be regarded as being capable, as a whole, of surprising the public and conveying to it the idea of a wine of elegance and distinction, like a person dressed in black, rather than suggesting to it the simple concept of a wine that is dark in colour. This was not the case with NOVAL BLACK, where the word ‘black’ was not accompanied by a preposition and a word with a clear meaning, but only by the meaningless word ‘noval’ which might at most be perceived as a company name. Accordingly the marks had no conceptual similarity, despite their common element ‘black’.

* Turning to the likelihood of confusion, the The Board of Appeal's assessment was based on its faulty comparison of all three components of the marks themselves -- the visual, the phonetic and the conceptual. Further, since both marks were word marks, the Board's references to case-law were irrelevant to the extent that they dealt with the increased likelihood of confusion when marks that included figurative elements which were likely to differentiate them were reproduced without those figurative elements on menus used in cafes, bars or restaurants.

* Given the low degree of visual and phonetic similarity of the signs and their conceptual differences, even the fact that the marks were for use on identical goods was insufficient to establish a likelihood of confusion on the part of a public that demonstrates a reasonable level of attention.

This Kat thinks that the General Court has got it right. He adds that, while OHIM instances and the General Court will naturally fasten on to the evidence before them, there is a world of evidence to suggest that the word 'black' is a pretty heavily used one in wine circles. Apart from the fact that 'black' can indicate the colour of grapes used in the wine-making process and is therefore somewhat descriptive, it seems to be shared by many other traders in the manufacture and retailing of wine, for example:

Thursday, 28 May 2015

The IPKat is delighted to receive from a Katfriend this brief summary of an important decision handed down this morning. More detailed consideration may follow in due course.

IPKat readers who have followed this saga will know that earlier this year Mr Justice Arnold gave the first detailed consideration of what a Swiss-form claim means, see blog post here and here. Today the Court of Appeal handed down its decision in the latest of this ongoing litigation involving Warner-Lambert's blockbuster Lyrica product.

As a brief refresher, in Warner-Lambert Company, LLC v Actavis Group Ptc EHF & Others [2015] EWHC 72 (Pat) Arnold J construed the Swiss form claim as requiring the infringer (for example a generic producer) to “subjectively intend” the medicine to be used for the patented indication. Under this test the patentee would not be able to succeed on infringement unless it could show that the generic company had aimed at or targeted the patented use in some way. In his subsequent judgment dated 6 February 2015, Arnold J ordered that Warner-Lambert’s claim for indirect infringement under section 60(2) of the Patents Act be struck out.

In a judgment handed down today Warner-Lambert Company, LLC v Actavis Group Ptc EHF & Others [2015] EWCA Civ 556 the Court of Appeal (led by Lord Justice Floyd) has put forward a wider test for the infringement of second medical use patents. On direct infringement under section 60(1)(c) of the Patents Act, Lord Justice Floyd departed from Arnold J’s subjective intent test which amounted in effect to requiring that the patentee prove that it is the generic’s “wish or desire” to sell some medicine for the patented indication. Floyd LJ concluded that it was sufficient for infringement that the producer knows (including constructive knowledge) or can reasonably foresee that the medicine would ultimately be intentionally used for pain. Floyd LJ commented that on his construction of the claim “it is plain that Warner-Lambert have an arguable case of infringement”. Infringement will now be considered at the trial at the end of June. On indirect infringement under section 60(2) of the Patents Act, the Court also allowed Warner-Lambert’s appeal against the striking out of that claim.

The Court of Appeal did however decline Warner-Lambert’s proposed interim relief. Warner-Lambert had sought (1) that a contractual condition be included in any agreement entered into by Actavis with any pharmacy or with any intermediary for the supply to a pharmacy of its generic pregabalin product that the pharmacy use reasonable endeavours to ensure generic pregabalin would not be supplied or dispensed to patients who have been prescribed pregabalin for pain; (2) that Actavis inform Warner-Lambert’s solicitors of the name of any intermediary they intended to supply their product to; and (3) that Actavis’ generic pregabalin product be supplied in bulk packaging bearing a notice stating legibly 'This product should not be dispensed for pain.' The Court of Appeal commented that, even if infringement is found at trial, “it does not follow that unqualified relief will follow as of right”. This case has already seen the grant of a novel order addressed to NHS England requiring it to give central guidance to prescribers and dispensers. No doubt other developments will follow.

Even the most fervent football-agnostic must by now have spotted that all is not well in the wonderful world of the Fédération Internationale de Football Association, otherwise known as FIFA. Indeed, a Google search of the terms FIFA + corruption yielded over 29 million hits. This weblog has not been uniformly impressed with FIFA's intellectual property activities over the years (see eg "Fifa scandal: the sponsors awaken", here; "FIFA's unfair catenaccio on World Cup's IP", here; "Ferrero v FIFA (in the World Cup trade mark dispute) -- 1:0 says the German BGH", here; "Put those vuvuzelas away, here comes FIFA", here; "Pants off in Anti-Ambush Marketing Frenzy", here; "Ferrero 5 Fifa 0 -- but will there be a replay?", here; "World Cup 2018: a dilemma for some sponsors?", here; "Global IP: the British are (almost, sort of) best", here).

Did Nike just do it? The company is said to becooperating fully with the US authorities

The popularity of the product offered by FIFA -- football tournaments, recordings, memorabilia etc -- is so great that no amount of toxicity of the FIFA brand image appears capable of denting it. Whether the same can be said for FIFA's major sponsors over the years, which include Nike, Coca-Cola, Visa and McDonalds, Gazprom, Hyandai, Kia and Adidas, remains to be seen. Consumer brands such as Nike and Coca-Cola have more to gain from association with wholesome causes -- and more to lose from unwholesome ones -- than enterprises such as Gazprom whose clientele is unlikely to switch to another brand of fuel supplier on a whim or a matter of moral scruples.

The current spate of arrests of FIFA dignitaries and officials for a range of corruption offences spanning some 20 twenty years, offences of which FIFA President Sepp ("I know nothing") Blatter denies all knowledge, set this Kat thinking. Bribery and corruption appear to be endemic within FIFA, and indeed within much of the world within which we live. Why not therefore come to terms with the inevitable?

A simple scheme would provide for the registration of all bribes and inducements received by FIFA office-holders and functionaries. It would work as follows:

A centralised register of bribes would be administered, naturally, by FIFA itself;

Recipients would be allowed to retain the benefit of all bribes and inducements received, so long as they were registered within three months of being promised or received, whichever the earlier;

Required registration details would include the name of the donor, the organisation if any on behalf of which the bribe or inducement was made, the sum involved, the currency of payment and whether payment was made gross or net of tax deductions;

The objective to be secured by making the bribe or inducement should be declared, together with information concerning the making of bribes or inducements to other recipients in connection with the same objective, if known;

In the case of non-pecuniary inducements (holidays, hospitality, sexual favours etc), recipients would be required to provide either an estimate of their cash value or, where that should not be possible, an indication of personal gratification on a scale of 0 to 10;

It should be clearly stated whether the bribe or inducement is required to be refunded in the event that the objective to be achieved is not met (note: this does not apply to the non-pecuniary inducements listed above);

Recipients should state whether the bribe or inducement received is final in its effect or whether it may be superseded by a subsequent bribe or inducement.

This scheme would not only make the bidding for World Cup venues and other entitlements more transparent but would also open it up to more competitive bidding. In addition, recipients of bribes and inducements would no longer have to go around in an embarrassing state of denial, and everyone -- including FIFA Presidents -- would be taken, by virtue of the fact of registration, to have constructive notice of all amounts declared and the purposes for which they were given and received.

Many things can motivate a blogger to set aside what they are doing and begin to pen a blogpost. It may be excitement about a judgment that has just come out, enthusiasm about a new legal development, or interest piqued by a news item. Sometimes, it is grumpiness. This is one such time.

The IPKat is a keen user of various social media, and anyone using applications such as Twitter to follow developments in the world of intellectual property cannot fail to have been bombarded, as has the IPKat, by items about the European Inventor Award 2015. There is an extensive section on the website of the European Patent Office about this event, going back to 2006. Merpel notes that this is in stark contrast to the tiny section, as she posted earlier this week, about the Unitary Patent.

The IPKat wants to know what on earth the EPO is doing lavishing such resources on such an event.

Article 4(3) of the European Patent Convention states that:

The task of the Organisation shall be to grant European patents. This shall be carried out by the European Patent Office supervised by the Administrative Council.

Ultra vires = no no

Whatever the European Inventor Award is, it is certainly not "to grant European patents". So this Kat's first gripe is that the event seems completely ultra vires in respect of what the EPO is actually supposed to be doing. National patent offices may have a wider mandate to foster innovation, to promote intellectual property generally, and to raise the profile of patenting, but the EPO most emphatically does not. At best, it is a distraction, and an apparently costly one at that, from the EPO's legally defined role.

"Maybe this year I'll manage it ..."

But this Kat thinks that it is worse than that. The European Inventor Award is about ranking inventions. Publicly proclaiming that one invention (the winner) has more merit than others (the runners up and those that were not even nominated). This is actually contrary to the EPO's role as a body that grants patents, in which role (its only legally ceded role) it is bound to judge any invention against the objective standards of novelty and inventive step, irrespective of merit with respect to any other invention. Others are free to opine that one invention is "better" or has more worth than another, but the EPO should be quite disinterested in this. Its involvement with such an event tarnishes its objectivity.

The European Patent Office does many laudable things that do relate to its task assigned by Treaty of granting European patents. The development of electronic registers, online access to prosecution files, development of patent databases and search tools, and pioneering work on online filing systems. And of course training in respect of all of these. These activities are to be lauded and welcomed.

The European Inventor Award is at best an expensive distraction, and at worse a dangerous compromise of principle.

As ever, the IPKat welcomes comments from our readers, and to this end a poll has been arranged on the sidebar to coincide with this post, where readers can express their own view of the European Inventor Award. The IPKat looks forward to hearing your views.

Wednesday, 27 May 2015

Because the AmeriKat does not believeshe is doing anything wrong, does this give her a defenceto destroying a toilet paper roll?

Does your belief that you are not doing something wrong, give you a defence to conduct that is in fact wrong? This question is likely still haunting Cisco following yesterday's US Supreme Court defeat in Commil USA, LLC v Cisco Systems, Inc (2015).

In a 6-2 vote (Justice Breyer was recused), the highest court in the United States overturned the decision of the US Court of Appeals for the Federal Circuit (CAFC) that held that the Cisco could run the "good faith" defence against Commil's claims that Cisco directly infringed its patent for a method of implementing short-range wireless networks and had induced others to infringe by selling the infringing equipment for them to use. After two trials, Cisco was found liable for both direct and induced infringement. The question before the Supreme Court concerned the inducement element. Cisco had argued in defence to inducement that it had a good-faith belief that Commil's patent was invalid. However, the District Court held Cisco's supporting evidence to be inadmissable. The CAFC held that the District Court had erred in excluding Cisco's evidence.

The Background

Cisco took issue with two of the District Court's rulings. The first related to the District Court's instruction to the jury in the second case that dealt with Cisco's alleged inducement. The jury was instructed that it could find inducement if:

“Cisco actually intended to cause the acts that
constitute . . . direct infringement and that Cisco knew or
should have known that its actions would induce actual
infringement.”

On this basis, in finding Cisco liable for induced patent infringement, the jury awarded Commil $63.7 million in damages.

Cisco looks forward to the retrial.

After the verdict in the second trial which dealt with inducement, the Supreme Court delivered its decision in Global-Tech Appliances Inc v SEB SA (2011). That case held that in an action for induced infringement it is necessary for the claimant to show that the alleged inducer knew of the patent in question and knew that induced acts were infringing (note the added emphasis on knowledge). Cisco therefore argued that the jury instruction was incorrect because nowhere did it state that knowledge of the inducement was the standard. Cisco appealed to the CAFC who concluded that the District Court erred in its instruction. In instructing the jury that Cisco could be liable if it "knew or should have known" that its customers infringed, it had left the door open for the jury to find infringement "based on mere negligence where knowledge is required". A new trial is now required with a corrected instruction on knowledge to the jury.

The CAFC's second, related ruling excluded Cisco's evidence that it has a good-faith belief that Commil's patent was invalid. In siding with Cisco, the CAFC held that "evidence of an accused inducer's good-faith belief of invalidity may negate the requisite intent for induced infringement." That is to say, how can a defendant ever be said to know that it has caused acts of induced patent infringement if a defendant does not believe there is even a valid patent that can be infringed? If the defendant thinks there is no harm to be done, how can the defendant be held to know that it has caused harm? The CAFC also considered that there was "no principled distinction between a good-faith belief of invalidity and a good-faith belief of non-infringement for the purpose of whether a defendant possessed the specific intent to induce infringement of a patent."

However, this holding was not without it's critics in the CAFC. Judge Newman, to whom the AmeriKat had the pleasure of listening at last year's Fordham (see post here), dissented. In her view, a defendant's good-faith belief that a patent is invalid is not a defence to induced infringement. "Whether there is infringement in fact, " she wrote "does not depend on the belief of the accused infringer that it might succeed in invalidating the patent."

The Question

Whether a good-faith belief in invalidity is a defence to induced infringement?

The Answer

The US Supreme Court

No. After Justice Kennedy trotted through the Court's 2011 decision in Global-Tech(in which he was the lone dissenter), the Court explained their opinion in four parts. First, infringement and invalidity are separate matters under patent law. Indeed, issues of infringement and validity appear in separate parts of the Patents Act. The defences of non-infringement and invalidity are two separate defences. As Newman J wrote in her dissenting opinion "validity and infringement are distinct issues, bearing different burdens, different presumptions, and different evidence." The key element to the question as to whether a defendant is liable for induced infringement is infringement - not validity. Under section 271(b), the statute requires that the defendant "actively induce[d] infringement" which requires intent to "bring about the desired result", being infringement. Belief regarding validity has no role to play whether there was intention to bring about infringement. Invalidity, after all, is not a defence to infringement. Invalidity is a defence to liability. Therefore belief as to invalidity "cannot negate the scienter required for induced infringement." To hold otherwise, would conflate the issues of infringement and validity.

Second, to allow such a defense would also undermine the "common core of thought and truth" that a patent is presumed valid. This presumption makes it possible for a patentee to commence a claim without first having to prove that his patent is valid. If belief in invalidity were a defence to induced infringement, the presumption would be undermined to such a degree that a defendant could prevail if he proved that he reasonably believed that the patent was invalid. The reasonable belief standard would fly in the face of the "clear and convincing" standard of proof established by Congress that defendants must meet to rebut the presumption of validity (see the AmeriKat's posts on Microsoft v i4i).

Third, such a defence would also have negative consequences in that it could render "litigation more burdensome for everyone involved". The availability of such a defence could incentive every potential inducer to advance a theory of invalidity, the veracity of which would be more difficult for the court to assess than questions of infringement. This could result in accused inducers finding it "easier to prevail on a defence regarding the belief of invalidity than non-infringement. In addition the need to respond to the defence will increase discovery costs and multiply the issues the jury must resolve. Indeed, the jury would be put to the difficult task of separating the defendant's belief regarding validity from the actual issue of validity."

Finally, in its reasoning, the Supreme Court also placed weight on the practical reasons why not to create a defence based on a good-faith belief in invalidity. Practically, if the defendant really has a belief that the patent is invalid then there are procedural avenues open to them. They can prove that the patent is invalid as an affirmative defence, file a declaratory judgment requesting the court to declare the patent invalid (MedImmune v Genetech (2007)), seek inter partes review at the Patent Trial and Appeal Board or seek ex parte rexamination at the Patent and Trademark Office.

"It follows, as night the day, that only valid patents can be infringed. To talk of infringing an invalid patent is to talk nonsense." Although readers could be forgiven in thinking that such colorful dicta came from the mouth of our beloved Sir Robin Jacob, it actually came from Justice Scalia in his dissent ["This is where the comparisons between the two stop," Merpel hastens to add].

In what reads like an angry professor marking an incompetent, but arrogant, student's exam paper Justice Scalia (who was joined by Chief Justice John Roberts) picks apart each of the Court's arguments. His own reasoning goes like this:

1. Induced infringement requires knowledge that the induced acts constitute patent infringement (see Global-Tech).
2. Only valid patents can be infringed.
3. Anyone with a good-faith belief in a patent's invalidity, necessarily believes the patent cannot be infringed.
4. It is impossible for anyone who believes the patent cannot be infringed to induce actions that he knows will infringe it.
5. A good faith belief that a patent is invalid is therefore a defence to induced infringement of that patent.

Justice Scalia considered that the fact that infringement and validity are dealt with separately under the Patents Act was irrelevant. "Saying that infringement cannot exist without
a valid patent does not “conflate the issues of infringement
and validity,” ... any more than saying that water
cannot exist without oxygen “conflates” water and oxygen.
Recognizing that infringement requires validity is entirely
consistent with the “long-accepted truth . . . that infringement
and invalidity are separate matters under patent
law.”" Further, permitting a good-faith invalidity defence would not undermine the statutory presumption of validity. All it would do would be to permit an alleged inducer the possibility to avoid liability for a third party's infringement of a valid patent. It would not undermine the patent's presumed validity (the AmeriKat recommends listening to the opening questions from Chief Justice Roberts regarding the percentage of patents that are upheld as valid here saying that 60% of patents being found to be valid is not much of a presumption of validity).

In saying that “invalidity is not a defense to
infringement, it is a defense to liability.” the Court was merely making "an assertion, not an argument." Justice Scalia reiterated that infringing a patent means invalidating the patentee’s right of exclusivity: "An invalid patent confers no such right. How is it possible
to interfere with rights that do not exist? The Court has no answer."

Scalia considered the Court's weakest argument to be its reliance on "practical reasons" not to create a defence based
on a good-faith belief in invalidity. He concluded:

"Ours is not a common-law court.
Erie R. Co. v. Tompkins, 304 U. S. 64, 78 (1938). We do
not, or at least should not, create defenses to statutory
liability—and that is not what this dissent purports to do.
Our task is to interpret the Patent Act, and to decide
whether it makes a good-faith belief in a patent’s invalidity
a defense to induced infringement. Since, as we said in
Global-Tech, supra, the Act makes knowledge of infringement
a requirement for induced-infringement liability;
and since there can be no infringement (and hence no
knowledge of infringement) of an invalid patent; goodfaith
belief in invalidity is a defense."

The Troll Issue

Patent for a troll, does not make a patent troll.

Commentators have picked up on the identity of the patentee - a troll/patent assertion entity/non-practicing entity/etc - as being the headline grabber in this case, if only to paint a picture of General Counsel throughout Silicon Valley being on the edge of their seats awaiting this decision. However, the Court's comments in this respect were limited. The Court said that they were well aware of the industry that had developed in which patents were being used primarily for obtaining licensing fees. Such conduct can create a "harmful tax on innovation". However, because no issue of frivolity had been raised by the parties in this case the Supreme Court did not comment further, except to reinforce the power that the district courts have in dissuading frivolous cases. The Court stated that:

"If frivolous
cases are filed in federal court, it is within the power
of the court to sanction attorneys for bringing such suits.
Fed. Rule Civ. Proc. 11. It is also within the district
court’s discretion to award attorney’s fees to prevailing
parties in “exceptional cases.” 35 U. S. C. §285; see also
Octane Fitness, LLC v. ICON Health & Fitness, Inc., 572U. S. ___, ___–___ (2014) (slip op., at 7–8). These safeguards,
combined with the avenues that accused inducers
have to obtain rulings on the validity of patents, militate
in favor of maintaining the separation expressed throughout
the Patent Act between infringement and validity.
This dichotomy means that belief in invalidity is no defense
to a claim of induced infringement. "

Justice Scalia, however, viewed the Court's holding as increasing the "in terrorem power of patent trolls" and viewed the Court's comments about district courts authority in this respect as seemingly acknowledging the consequences of its opinion.

What does this mean?

Key message: Be proactive in invalidating patents, not reactive in saying you thought the patentwas invalid.

So what is the importance of this case? One of Cisco's lawyers, Seth Waxman, is reported as saying that the decision "simply eliminates one of many defenses available to Cisco, which looks forward to retrial of the case." Commil's counsel, Mark Werbner, said that it restored "common sense to patent litigation." The AmeriKat considers that this decision shows the Supreme Court actively encouraging would-be infringers/inducers to proactively invalidate patents, especially those wielded by patent trolls, through avenues already available to them. Given the options already available to challenge the validity of patents, the Court will be reluctant to create short-cuts for defendants to escape liability from infringement of patents that already benefit from a presumption of validity. It also acts as another loud and clear message to the district courts, following a year of such messages, that they have the authority to discourage the patent troll industry from benefiting from the threat of patent litigation.

All that being said, many commentators are left at a loss as to the Supreme Court's reasoning, much for the same reasons that Justice Scalia expressed in his dissent. Given that Global-Tech was all about the knowledge of the inducer, is the court's reasoning satisfactory? How can an inducer who does not believe that a patent is valid, have the knowledge that what it is inducing amounts to patent infringement? Infringement and validity merely being in separate parts of the Patents Act seems too convenient an answer for some, including Justice Scalia. The answer may be as simple as what Judge Newman was getting at - belief is not the same as fact.

Unless the Supreme Court rexamines this questions again, which seems unlikely, the state of affairs is this: Even if you actually believe the patent is invalid, you can still be liable for inducing infringement unless you prove that the patent is, in fact, invalid.

To listen to the oral arguments before the Supreme Court, please click here.

According to a comment received on her earlier post, Merpel understands that the European Patent Office has responded by means of the following internal Communiqué to the concern about reports that Control Risks (who describe themselves as "an independent, global risk consultancy specialising in helping organisations manage political, integrity and security risks in complex and hostile environments") has been commissioned by the EPO to investigate staff members:

Investigative Unit and external firms
26.05.2015

Regarding questions raised in recent publications and blogs [Merpel has the feeling that they mean her ...]

Dear colleagues,

Some recent publication and blogs have questioned the participation of an external firm in EPO activities related to the Investigative Unit. I want to clarify that because the EPO Investigative Unit is rather small in terms of staffing, we need to be able to contract external companies to support our fact finding enquiries. This is one reason why an external firm can be chosen in regard to an investigation, operating within the regulatory framework of the EPO, under the full supervision of the Investigative Unit.

The European Patent Office cannot comment on specific internal investigation cases. This lack of comment is to protect the integrity of any such case and protect the interest of all parties concerned. However I would like to remind the Office has a duty of care to its employees including to investigate allegations of harassment against them by other employees. Investigations can only take place following specific allegations, made by EPO staff or external parties, and these investigations are independently and objectively carried out by the Investigative Unit, under its sole responsibility.

The investigation process of the EPO follows the best international standards and allows persons to be heard, to respond and to defend themselves against any allegations, before any conclusion of misconduct would be reported to the employee's appointing authority. Only in any case where a serious misconduct is confirmed by the Investigative Unit, a disciplinary case could be instigated where the subject has a further right to be heard before a disciplinary committee and before any subsequent decision on a sanction would be taken.

In 2014, the Investigative Unit received 68 allegations of misconduct (-23% compared to 2013), 50% being already rejected as insufficiently specified.

John Martin
PD Internal Audit and Oversight‎

Merpel welcomes this response, but regrets that it was made only internally, when the concern raised was much more widespread, and wonders what the EPO Communications department is up to. She notes that, although it is only stated that an "external firm" has been engaged, the Communiqué appears in essence to confirm the original reports concerning Control Risks.

The response does gloss over a few salient facts that have been mentioned in posts and comments in this blog and Merpel wonders if the EPO would like to address these. For example:

1. The "appointing authority" to whom the Investigative Unit presents its report is the President*. It is he who instigates a disciplinary procedure "where the subject has a further right to be heard before a disciplinary committee". True enough, and very laudable ... except the recommendation of that disciplinary committee then goes back to the President who can (and, we are told, frequently does) ignore the outcome of the process. If the disciplinary committee system is even-handed and to be trusted, why are its recommendations ignored? Indeed, how do the rules even permit this?

* though not for Board of Appeal members and the most senior management.

2. The Investigative Unit is used not only to follow up on complaints between staff members, but also frequently to investigate subjects whom the President has identified to them - it has been mentioned in comments on this blog that this includes a certain member of the Boards of Appeal, and a member of the Central Staff Committee who had the temerity to try to organise a survey on how EPO staff viewed the President's controversial "social reform" programme. Merpel imagines that such investigations have a decidedly sedative effect on other employees who were thinking of sticking their heads above the parapet, or even from serving on the Central Staff Committee.

3. The "best international standards" followed by the Investigative Unit don't include allowing the employee to be represented by a lawyer. Perhaps readers think that "lawyering up" at an early stage is an over-reaction, but consider that the employee may face dismissal without any of the safeguards of labour law available in the EU or other member states. The targets of investigation are severely restricted from even disclosing that they are being investigated, and apparently have an active duty to cooperate, so no "right to silence"; and the Investigative Unit (and by extension, Control Risks) has the power to invade the privacy of the subject to an extent that would cause uproar if it happened in a national patent office or in any private enterprise operating within the EU.

As ever, Merpel welcomes comments, but begs to remind readers of the following:

Henceforth, in respect of all EPO-related blogposts, no comment will be posted if it is merely ascribed to "Anonymous". Any reader wishing to conceal his or her identity must adopt a pseudonym (which should not be obscene and should not be the name, or the mis-spelling of the name, of a real person). The pseudonym need not be an actual login name, as long as it is stated clearly at the beginning and/or end of the comment itself. This way, it will be easier for people who post later comments to identify and remember the earlier comment-poster and to recall the discussion string. Where, as has already happened on occasion, a string carries over from one blogpost to a later one on the same or a related subject, readers will be encouraged to use the same pseudonym for the sake of continuity.

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